Digital commerce to reach Rs 220,330 crore by December 2017

The report finds that online travel industry continues to grow strongly with 56 per cent, while non-travel stood at 44 per cent

The digital commerce market has grown at a compound annual growth rate (CAGR) of 30 per cent, between December 2011 and December 2016 to reach Rs 168,891 crore by the end of December 2016. It is estimated to reach Rs 220,330 crore by December 2017, according to the Digital Commerce report 2016, published by the Internet and Mobile Association of India (IAMAI) and IMRB Kantar.Â

The report finds that the online travel industry continues to grow strongly with 56 per cent while the share of online non-travel has improved over the previous year to reach 44 per cent.

Domestic air ticket and railways booking continue to be among top contributors to the online travel spends. These were the segments that were the top contributors in the previous year also. Hotel booking has seen a substantial growth of 60 per cent, from Rs 5,200 crore in December 2015 to Rs 8,320 crore in December 2016. Domestic air tickets booking is the highest contributor in this segment and has grown 20 per cent from Rs 31,619 crore to Rs 38,160 crore in 2016. The online travel market is expected to reach close to Rs 118,598 crore by December 2017. The segment was valued at Rs 95,198 crore in December 2016.

The report finds that e-tailing maintained a strong performance with 59 per cent growth. In the e-tail category, mobile phone and mobile accessories continue to be the top contributor to the overall pie. Another product category that has registered a sharp growth is apparel, personal health care products and accessories. These two categories collectively account for 60 per cent of the overall spend in e-tail segment. The e-tail segment is expected to reach around Rs 94,964 crore by December 2017. It was pegged at Rs 59,876 crore in December 2016.

The report also finds that online utility services market like payment for DTH/ telephone bills/ electricity bills and so on registered close to 20 per cent growth between 2015 and 2016. The market reached close to Rs 6,277 crore in terms of overall online transactions as on December 16. The segment is expected to reach Rs 7,532 crore by December 2017.

Other online service market that includes online bookings for entertainment, online grocery and online food delivery, was pegged at Rs 3,823 crore in December 2015. In December 2016 the market reached close to Rs 4,170 crore. Online food delivery is the top contributor within this segment with a market value of Rs 2,040 crore. This growth is expected to continue in future and the market is expected to reach Rs 4,587 crore by December 2017.